For the second time this year, Ten’s high-profile list of star shareholders, including Gina Rinehart, James Packer, Lachlan Murdoch and Bruce Gordon will need to open their wallets to save Australia’s third ranked commercial television network from a knock at its door from its bankers.

The commercial success for any television network rests with its ability to produce programs that capture the attention of viewers. The other critical success factor is doing it within well managed cost bounds.

Tragically for Ten, its new billionaire masters either underestimated or have been unable to meet the first priority. In October, Ten’s market share fell to a perilously low 21 per cent.

James Packer, Lachlan Murdoch and Gina Rinehart have lost at least $360 million on their combined investments in little over a year. Their plan to buy into Ten, seize control of operations, cut costs and tweak programming has badly backfired.

Instead the network has found itself in a nasty spiral of falling ratings and revenue and the need to deeply axe costs, which affects its ability to buy the programs needed for its revival.

Ten's TV revenue slumped 14.5 per cent in the 2012 financial year while its TV earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 46.5 per cent year-on-year.

The first job of its relatively new chief executive, James Warburton, was to raise fresh equity to avoid this situation. But the $200 million the company raised in June was not enough and industry analysts argued it should have raised more to put a dent in the company’s debt levels.

This time around the new shares will be sold for far less - which will represent a deep (and expensive) dilution for all but those that subscribe to the issue.

Having sold its outdoor advertising business Eye Corp there are now no large saleable businesses that can raise meaningful amounts of cash.

Today’s announcement of a new equity raising represents an major embarrassment for James Warburton who assured investors a few months ago there would be no need to raise fresh cash.

While he cannot be blamed for all of the program related decisions, his credibility will receive a blow as he will be perceived as badly under-estimating the gravity of the situation.

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